Weekend Extra: For love and money

Denise Ryan, Vancouver Sun02.10.2013

On March 18, when B.C.'s new Family Law Act comes into effect, couples that have cohabited for two years will be subject to an entirely new set of laws governing division of property, assets and debts. Couples with two years of shared living quarters will be considered full spouses under the law, and the way things get divided if they decide to uncouple will be decidedly different.Getty Images files
/ Postmedia News

Jennie Weeks, with her sons Oliver, 9, and Benjamin, 11, is a divorced mother of two and a financial planner. She ended her recent live-in relationship just before the second anniversary, since under B.C.'s new Family Law Act the same common property rules that apply to married couples apply to couples who merely live together after two years.Mark Van Manen, PNG
/ Vancouver Sun

Marriage has always been complicated. Now living together is about to get a little more complicated - or less, depending on how you look at it. On March 18, when B.C.'s new Family Law Act comes into effect, couples that have cohabited for two years will be subject to an entirely new set of laws governing division of property, assets and debts. Couples with two years of shared living quarters will be considered full spouses under the law, and the way things get divided if they decide to uncouple will be decidedly different.

"The critical point is that you went to bed on March 17, you had no presumptive right to your spouse's property; you woke up on the 18th and you do," said J.P. Boyd, a Vancouver family lawyer.

"The critical thing is extending property rights to unmarried couples, even if the property is not in both of your names. Under the old law you had to prove that you had enriched me and contributed something to myself or my property that came as a corresponding loss to you. It was an ugly, horrible task," said Boyd, difficult to undertake and prove.

Unmarried couples that have lived together for at least two years now have the same rights to property, family assets and even spousal support that married couples have. They don't have to prove anything, other than that they lived together.

Boyd credits the province for reflecting important social changes in the law.

"That's a real tip of the hat and a recognition to the changing demographics of our time."

The overhaul of the provincial law on family breakdown covers care of children, support issues and family property and makes significant changes that will affect all families, whether married or not.

Among couples that are shacking up, the change is remarkable, substantially benefiting long-term partners that previously had limited protection. But what about the casual majority, couples that live together for convenience, for financial reasons or because they're secretly holding out for someone better?

Research shows that the way we make decisions about cohabitation is very different than the way we make decisions about marriage. Moving in together is often a case of "sliding, not deciding," a classic trajectory of one sleepover that leads to another, then a key, a toothbrush and change of clothes.

The decision is often casual, made for the sake of convenience or for financial reasons. The latter is especially true in cities like Vancouver or New York with their staggering housing costs.

"This could very much change the way people get into living together. It will change the way they are thinking about it," said Meg Jay, assistant clinical professor at the University of Virginia.

Cohabitation often happens very early in a relationship, especially among 20-somethings. "There is less consciousness about it than about marriage. It's not a big choice, it's a thousand little choices."

Couples get together quickly, said Jay. "They are having fun together, having good sex ... we're often talking one or two months. It's a little early to be talking about intentions."

Jay, who is the author of The Defining Decade: Why Your Twenties Matter, said that casual decision can have long-term consequences because it's harder to get out of a relationship, even a bad one, than it is to get into one.

"It can lead to lock-in, a phenomenon of human behaviour where once you get entangled in something it can be hard to get out of it. You've got a lease, a couch, a dog, all the friends. From toothbrush to two years can really be the blink of an eye."

Jay compares the way we mate to the way we shop. Studies in behavioural economics show consumers will stay with an online shopping site they have already entered their credit card information on, even if they can get a better deal somewhere else, simply because it's too much of an effort to change. The longer you're with someone, or something, the less likely you are to change because of all the challenges associated with making a move.

Partners who choose to live together, rather than marry, also often come together with different, and sometimes hidden, agendas.

"Research and my work with 20-somethings shows men are more likely to say 'this relationship is an audition,' or 'a way for me to save money on rent and do what all my friends are doing,' whereas 20-something women often see this as a move toward real commitment," Jay said.

For Jennie Weeks, a financial planner and divorced mother of two, the two-year cutoff she knew was coming helped her make a decision to end a live-in relationship.

"When you move in with someone, your first thought is not that you are going to have to share what you accumulate together in the event that you split up; but now you've got to start having those conversations," says Weeks. "We split at the two-year mark, to the day."

Part of what makes having those conversations tricky is that it's not just about whether one person will or will not sign a "pre-nup" agreeing to forgo an interest in the family home, or to your future pension benefits. The conversation can lead to equally fraught discussions about what each person wants out of the relationship, and life.

Weeks, a financial planner who also specializes in working with women who are divorcing, was well aware of the upcoming changes in the law - and she had two young boys whose interests she had to put first. When she brought up the issue of property and assets, her boyfriend was as breezy about it as she was serious.

"He said he'd sign anything," said Weeks. But the conversations revealed deep gaps in how they envisioned their future.

Weeks had already gone through substantial life-changes when she and the father of her children, then 2 and 4, divorced. She faced the fact that divorce meant downsizing, sold the family home in Kerrisdale, moved to the east side, and launched a career that would lead to financial independence and allow her to be the best post-marital partner and parent she could.

"My ex-husband and I now had to manage two households. In Vancouver, on one income, that's hard. On the west side, it's nearly impossible."

She and her husband carved out a collaborative divorce that was "more than amicable," putting the children's needs first and accepting the lifestyle changes that came.

The process was empowering. "I wasn't going to be a victim," Weeks said.

The next relationship she got into was lighthearted. He earned less than she did, worked in the service industry and didn't think too much about the future. "It was a lot of fun," said Weeks.

"He was great with the kids, supportive of me. At first it didn't matter that he earned less than I did. Or I thought it didn't."

Weeks was delighted when he moved in.

Her boyfriend didn't share the same income; it wasn't until they started talking about the implications of the upcoming changes for cohabiting couples that she learned he didn't share the same dreams. "With us, it was fundamentally about values," says Weeks.

Her boyfriend moved out and, although they are still friends, it's been a difficult transition. "It was sad. But having the discussion about money made it clear that we were going in different directions."

Weeks advises couples to start talking about money early, and often in a relationship. Especially if they are cohabiting.

"Two years is very early in a relationship. And money is hard to talk about."

The cohabiters equivalent of a pre-nup - call it a "pre-hab" - can be even more difficult to figure out if you barely know the person you're moving in with. It's one thing to bond romantically, sexually or both, and quite another to start putting on paper who gets what when the beautiful dream ends.

Boyd said contracts that spell out who gets what may well become more common among couples that move in together. However, such contracts can be set aside by the courts if they are deemed unfair.

The thought behind the new law was not to scare people away from living together. Quite the opposite. "The idea was to capture the idea that more and more people are living together in unmarried relationships (and) are developing financial ties and dependencies. One of the objects of the reform of the legislation was to recognize the relationship of dependence that long-term relationships can have, whether they are married or unmarried," said Boyd.

Although there are significant exclusions under the new law that apply to couples married and unmarried - such as inheritance, gift, court awards and some pre-relationship property - divisible family property can include real estate, cash, personal property, pensions, RRSPs, increases in value of assets and, yes, you'll get to split the debts as well.

Boyd suggests doing the "poor-man's pre-nup" if you're moving in with someone and can't afford a legal agreement: "Photocopy your bank statements, property assessments, investments and statements, put them in an envelope and drop them in your safety deposit box."

The upside for casual live-ins, said Jay, may be that the two-year mark provides a kind of reckoning, a benchmark at which couples can have that conversation they've been avoiding: Where is this going?

Free family law seminars will be offered to the public featuring lawyers, financial advisers, parenting coaches in a series of workshops at the West Vancouver public library, 1950 Marine Drive West, Feb. 12 & Feb. 19 at 7 p.m.

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